DNC, Teamsters Are Linked In Campaign Funding Probe

May Have Discussed "Commitment" to Teamsters in Return for Donations

By GLENN R. SIMPSON
Staff Reporter of THE WALL STREET JOURNAL
July 24, 1997

WASHINGTON -- Last summer President Clinton and Teamsters President Ron Carey found themselves in the same boat: battling for second terms. To meet their pressing money needs, documents show that top Democratic fund-raisers and members of the Carey team may have cooperated to keep their campaigns flush.

Documents show a top DNC official directing the distribution of nearly $1 million in Teamster political action committee contributions to DNC affiliates nationwide. In return, according to a note written by a political consultant, the DNC allegedly made an unspecified "commitment" to help the Teamsters. According to one person involved, that commitment was to help find DNC donors to contribute money to Mr. Carey's campaign.

Such a plan could be an illegal misuse of Teamster PAC funds to benefit Mr. Carey's personal campaign for Teamsters president. Mr. Carey acts as a trustee of the Teamster PAC. It also could pose a public-relations problem for the beleaguered DNC if it acted as the middle man.

To be sure, it's not clear the plan was carried out. While the Teamsters PAC contributed more than $1 million to Democratic Party committees, there are no public records showing DNC help for Mr. Carey. A spokeswoman for the 1.4 million-member union, Nancy Stella, said its investigation hasn't found any evidence "that would lead us to believe anyone was aware of this, if it happened."

A spokeswoman for the DNC also said it wasn't aware of discussions on the alleged deal. "We don't believe any commitments were made nor plans implemented," said communications director Amy Weiss Tobe.

The note outlining a DNC commitment to the union was written by Martin Davis, a longtime Democratic political consultant who formerly owned 42% of the November Group, a now-defunct direct-mail firm whose clients include the Carey campaign, the Teamsters PAC and the DNC. Mr. Davis, who is also a longtime consultant to Mr. Carey, has been charged in federal district court in New York with using his role as a vendor with the Carey campaign to hide illegal gifts to the effort.

The money was allegedly taken from the Teamsters' general treasury.

Mr. Davis's lawyer, William Codinha, didn't return phone calls.

Last summer, Mr. Davis allegedly approached top DNC officials with a tantalizing offer. Mr. Davis indicated he could squeeze more money out of the plump Teamster PAC, says an ex-DNC official, if the DNC could help Mr. Carey. According to the former official, Mr. Davis wanted the DNC to persuade some of its large donors to contribute to Mr. Carey's campaign. The official said the DNC made no commitment to Mr. Davis, and no contributors were contacted.

The next day, Mr. Davis gave the memo to Teamsters PAC Treasurer Bill Hamilton, with a note referencing the alleged deal. "Bill: I'm forwarding this to you from Richard Sullivan," wrote Mr. Davis, referring to the DNC's then finance director. "I'll let you know when they have fulfilled their commitment." Mr. Sullivan's lawyer, Robert Bauer, declined to comment. Over the next several months, according to federal election records, the Teamster PAC doled out around $100,000 in contributions to Democratic state committees, far less than the $1 million outlined in the Sullivan memo.

Federal prosecutors and the FBI are examining how Mr. Davis handled the many direct-mail accounts he managed for the November Group. Among them were some of the Democratic committees that received Teamster PAC funds at the behest of the DNC's Mr. Sullivan.